Weathering the Financial Storm : Malaysia's Response and Strategies to Enhance SMEs Competitiveness
This paper discusses the importance of SMEs in Malaysia's economic development. It highlights the impact of the financial crisis on the Malaysian economy in general, and on SMEs in particular. A study by SMIDEC and FMM revealed that the majority of the sur- veyed firms reported that the crisis had had moderate effects on them. Among those who cited the crisis had badly affected them, many cited reduced orders as the cause for their credit problems. The surveyed SMEs adopted various measures in response to the crisis such as revising business plans, searching for new markets, and putting businesses on hold. The government also implemented two Economic Stimulus Packages (ESPs) to enable economic re- covery, shore up confidence and help businesses in general, and SMEs in particular. Whether these ESPs will enable Malaysia to cushion the economic downturn, is still too early to tell. As Mohamed Ariff, head of the Malaysian Institute of Economic Research told AFP "No matter how big the stimulus plan is, we can only help cushion the pain, it cannot offset it". (original abstract)
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